Nursing homes to get 1.8% Medicare pay raise in 2013

Skilled nursing providers say they are pleased with the federal government's decision to raise Medicare payments by 1.8% in fiscal year 2013. The cumulative $670 million pay hike will take effect Oct. 1, the Centers for Medicare & Medicaid Services revealed in a notice late Friday.

“After years of reimbursement volatility, today's update to Medicare payments is welcome news to skilled nursing providers,” said Mark Parkinson, president and CEO of the American Health Care Association. “AHCA appreciates CMS' balanced approach to this year's Medicare payment system after recognizing the many rounds of government reductions the profession has already endured.”

Providers had feared either a freeze or reduction in the FY 2013 SNF Prospective Payment System rates, which would have come on top of other cutbacks.

Click here to see the full 105-page CMS notice for full details on rate breakdowns, including those on therapy and resource utilization groups.

Among other items, CMS disclosed that providers' therapy coding — which had been criticized for drastically shifting into the highest category (Ultra-High) under a new system in fiscal 2011 — actually swung even heavier into that grouper in the first half of fiscal 2012. Another trend also continued: Virtually all therapy was administered on an individualized basis (99.5%) in the first half of fiscal 2012, as opposed to concurrent (0.4%) or group (0.1%) modes.

CMS is set to formally publish the FY 2013 SNF PPS rates in Thursday's Federal Register.

Drug substitutions saved the government $13 million last year, but more drug substitutions under Medicare Part B would have saved an additional $6 million, the Office of Inspector General for Health and Human Services concluded in a recent report to Congress.